Page 291 - DMGT522_SERVICES MANAGEMENT

Services Management

Notes low demand time, Lovelock and Young observed that consumers resisted the change. Therefore,
productivity related changes must be identified and implemented from the consumer’s
viewpoint. They further observed that insensitivity towards customers can be avoided by
observing some of the following suggestions.
First, develop customer trust in the productivity related changes through a systematic and
planned communication programme. Second, understand customer’s habits and understand
determinants of consumer behaviour. Zeithaml observed that consumer evaluation processes
of services are different from goods. Arising out of the unique characteristics of services of
intangibility, non-standardization and inseparability leads them to possess high level of
experience and credence properties which makes them more difficult to evaluate than goods.
Third, pre-test new procedures and technology before commercially introducing the same. This
would not only save substantial investment but also your existing markets. Also your
communication strategy should provide the benefit to the customer to stimulate trial and by
doing this you can win the consumer’s acceptance. Fourth, educate consumers about how to use
service innovations – simply installing them may be insufficient. And finally, productivity
improvement is not a static process but a dynamic one which occurs over time. Therefore,
monitor and evaluate performance periodically.

Did u know? Involving the customer in delivery process can enhance productivity.

Self Assessment

Fill in the blanks:
6. Involving the ......................... in the service delivery process in place of your own employees
can enhance the productivity.
7. ......................... related changes must be identified and implemented from the consumer’s
viewpoint.
8. One can increase productivity by increasing number of ......................... .
9. As a strategic tool, one can ......................... their services by broadening the quantity and
thereby quality.
10. Many service organisations, in their search for operating ........................., see consumers as
a nuisance, a constraint and a barrier to productivity.

14.1.3 Reduce Mismatch between Supply and Demand

The concept of de-marketing (Kotler) suggests a strategy to discourage the customers on a
temporary or permanent basis to achieve synchronisation between the demand and supply. He
used a term ‘sycro-marketing’ for such an exercise. The strategy should be either to manage
demand or supply or both.
Sasser suggested some basic strategies to alter demand so as to fit it within the available capacity.
In such situations where capacity is restricted, the four strategic options are as follows:
1. Developing off-peak pricing schemes
2. Non-peak promotion and demand creation
3. Developing complementary services

4. Creation of reservation system

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